Apple Inc. is rewarding investors with a stock split, an increase in share repurchases and big dividend jump after topping quarterly earnings and revenue forecasts on stronger than expected iPhone sales.

The world’s biggest tech company said it sold a record 43.7 million iPhones in the fiscal second quarter ended March 29, well ahead of the market estimate for 37.7 million.

Morgan Stanley analyst Katy Huberty said introduction of the cheaper 8GB iPhone 5c in developing regions along with price promotions at U.S. retailers and carriers “may have stimulated demand more than expected.”

CEO Tim Cook, under pressure to maintain growth in a slowing smartphone market, said the company set a “new March quarter record” for iPhone sales.

He said gains were broad based across consumer and enterprise segments and in developed and emerging regions, including the so called BRIC countries.

Incoming Apple CFO Luca Maestri cited a recent distribution deal with carrier China Mobile and demand in the country for the legacy iPhone 4s as a driver behind iPhone sales — and as a factor in a $41 (U.S.) drop in the average iPhone selling price during the quarter.

Apple sold 4.1 million Macintosh PCs, ahead of forecast, but missed the iPad target with 16.4 million sales versus the market expectation for 19 million.

Apple posted revenue in the quarter of $45.6 million and net profit of $10.2 billion, or $11.62 per diluted share. That compares to a year ago profit of $10.09 per share on sales of $43.6 billion

Analysts polled by Thomson Reuters expected net income of $9.1 billion or $10.17 per share in the January-March period on sales of $43.55 billion.

Wall Street had forecast a comparatively flat March quarter in advance of new product launches this year including a larger screen iPhone 6, a bigger iPad and possibly an iWatch and the long rumoured iTV.

“We believe the rumored iWatch will be Apple’s most important product this year,” KGI Securities analyst Ming-Chi Kuo said in a note to investors.

He said it will “carry much more weight than the iPhone 6, as market feedback should reveal whether Apple still has the ability to continue making game-changing products with Tim Cook at the helm.”

Steven Milunovich of UBS said Apple is in a “holding pattern” until then, relying heavily on the iPhone 5s and iPad Air sales.

But Apple, whose stock has lagged the tech market this year, saw its shares gain nearly 8 per cent after hours to $564.80 on the earnings and after the company said it will increase its share repurchase program to $130 billion from $100 billion.

Apple has faced criticism from activist investors, notably Carl Icahn, who has said the program should be greatly expanded given the company’s huge cash horde. Icahn tweeted his approval Wednesday.

“Agree completely with $AAPL’s increased buyback and extremely pleased with results. Believe we’ll also be happy when we see new products.”

Apple also announced an 8 per cent dividend increase to $3.29 per quarter, up 24 cents from the previous $3.05.

And the Cupertino, Ca.-based company unveiled an unusual seven-to-one stock split effective June 9, its first stock split in nine year, that will make the price of an individual Apple share far less costly.

For the current quarter, Apple said it expects sales of between $37 billion and $38 billion, in line with estimates.

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